Implementing the nationalization agenda in private

[CricketOnTheHearth]

Scaredy:

I’m thinking of buying solid silver and gold themselves with my savings, not just the mines.

I visited my local purveyor of Krugerrands, Eagles and Maple Leaves yesterday, and he said he’d been visited by a guy who swore Israel is gonna nuke Iran’s nuclear enrichment facility. I said my money was on conventional-explosives bunker busters, not nukes (that radioactive cloud would go just everywhere, write off half of the Middle East’s oil fields, etc). That said, a few 5000-lb bombs dropping down Ah-maniac-a-jad’s throat might be enough to rattle the markets right there.

Allan, are the commercial real estate loans also bundled (Freudian, I initially typed “bungled”) into impenetrable CDS’s, or can the banks cram down the balance in those cases to at least keep the borrowers alive and cash-flowing into the banks’ coffers to some extent?

[Allan from Fallbrook]

[quote=CricketOnTheHearth]

Allan, are the commercial real estate loans also bundled (Freudian, I initially typed “bungled”) into impenetrable CDS’s, or can the banks cram down the balance in those cases to at least keep the borrowers alive and cash-flowing into the banks’ coffers to some extent?[/quote]

Cricket: That I don’t know. The CRE thing came up in a conversation we were having about various colleagues (in insurance/surety, banking and finance) and their respective takes on the economy.

I can certainly ask, and I would imagine someone like Davelj on this forum would probably have a better handle on that than I.

One interesting thing that did come up relative to CRE was that downtown San Francisco has experienced tremendous turnover in the last five years (something like 75% of the buildings have changed hands through sales) and that many of the new owners are perilously close to default due to lost value and plunging occupancy rates. According to Wells, metro LA and parts of San Diego are facing similar circumstances and the large banks like Citi, Wells and BofA are looking down the barrel in terms of exposure to loss in their respective CRE portfolios. I’ve known the guy in question for over 20+ years, dating back to my time on the corporate side, and I’ve never known him to panic or give over to hyperbole, so when he says that he’s scared, its genuine.

[Allan from Fallbrook]

[quote=CricketOnTheHearth]

Allan, are the commercial real estate loans also bundled (Freudian, I initially typed “bungled”) into impenetrable CDS’s, or can the banks cram down the balance in those cases to at least keep the borrowers alive and cash-flowing into the banks’ coffers to some extent?[/quote]

Cricket: That I don’t know. The CRE thing came up in a conversation we were having about various colleagues (in insurance/surety, banking and finance) and their respective takes on the economy.

I can certainly ask, and I would imagine someone like Davelj on this forum would probably have a better handle on that than I.

One interesting thing that did come up relative to CRE was that downtown San Francisco has experienced tremendous turnover in the last five years (something like 75% of the buildings have changed hands through sales) and that many of the new owners are perilously close to default due to lost value and plunging occupancy rates. According to Wells, metro LA and parts of San Diego are facing similar circumstances and the large banks like Citi, Wells and BofA are looking down the barrel in terms of exposure to loss in their respective CRE portfolios. I’ve known the guy in question for over 20+ years, dating back to my time on the corporate side, and I’ve never known him to panic or give over to hyperbole, so when he says that he’s scared, its genuine.

[Allan from Fallbrook]

[quote=CricketOnTheHearth]

Allan, are the commercial real estate loans also bundled (Freudian, I initially typed “bungled”) into impenetrable CDS’s, or can the banks cram down the balance in those cases to at least keep the borrowers alive and cash-flowing into the banks’ coffers to some extent?[/quote]

Cricket: That I don’t know. The CRE thing came up in a conversation we were having about various colleagues (in insurance/surety, banking and finance) and their respective takes on the economy.

I can certainly ask, and I would imagine someone like Davelj on this forum would probably have a better handle on that than I.

One interesting thing that did come up relative to CRE was that downtown San Francisco has experienced tremendous turnover in the last five years (something like 75% of the buildings have changed hands through sales) and that many of the new owners are perilously close to default due to lost value and plunging occupancy rates. According to Wells, metro LA and parts of San Diego are facing similar circumstances and the large banks like Citi, Wells and BofA are looking down the barrel in terms of exposure to loss in their respective CRE portfolios. I’ve known the guy in question for over 20+ years, dating back to my time on the corporate side, and I’ve never known him to panic or give over to hyperbole, so when he says that he’s scared, its genuine.

[Allan from Fallbrook]

[quote=CricketOnTheHearth]

Allan, are the commercial real estate loans also bundled (Freudian, I initially typed “bungled”) into impenetrable CDS’s, or can the banks cram down the balance in those cases to at least keep the borrowers alive and cash-flowing into the banks’ coffers to some extent?[/quote]

Cricket: That I don’t know. The CRE thing came up in a conversation we were having about various colleagues (in insurance/surety, banking and finance) and their respective takes on the economy.

I can certainly ask, and I would imagine someone like Davelj on this forum would probably have a better handle on that than I.

One interesting thing that did come up relative to CRE was that downtown San Francisco has experienced tremendous turnover in the last five years (something like 75% of the buildings have changed hands through sales) and that many of the new owners are perilously close to default due to lost value and plunging occupancy rates. According to Wells, metro LA and parts of San Diego are facing similar circumstances and the large banks like Citi, Wells and BofA are looking down the barrel in terms of exposure to loss in their respective CRE portfolios. I’ve known the guy in question for over 20+ years, dating back to my time on the corporate side, and I’ve never known him to panic or give over to hyperbole, so when he says that he’s scared, its genuine.

[Allan from Fallbrook]

[quote=CricketOnTheHearth]

Allan, are the commercial real estate loans also bundled (Freudian, I initially typed “bungled”) into impenetrable CDS’s, or can the banks cram down the balance in those cases to at least keep the borrowers alive and cash-flowing into the banks’ coffers to some extent?[/quote]

Cricket: That I don’t know. The CRE thing came up in a conversation we were having about various colleagues (in insurance/surety, banking and finance) and their respective takes on the economy.

I can certainly ask, and I would imagine someone like Davelj on this forum would probably have a better handle on that than I.

One interesting thing that did come up relative to CRE was that downtown San Francisco has experienced tremendous turnover in the last five years (something like 75% of the buildings have changed hands through sales) and that many of the new owners are perilously close to default due to lost value and plunging occupancy rates. According to Wells, metro LA and parts of San Diego are facing similar circumstances and the large banks like Citi, Wells and BofA are looking down the barrel in terms of exposure to loss in their respective CRE portfolios. I’ve known the guy in question for over 20+ years, dating back to my time on the corporate side, and I’ve never known him to panic or give over to hyperbole, so when he says that he’s scared, its genuine.

[Arraya]

http://www.washingtonsblog.com/

So what is the real reason that the TBTFs aren’t being broken up?

Certainly, there is regulatory capture, cowardice and corruption:

Joseph Stiglitz (the Nobel prize winning economist) said recently that the U.S. government is wary of challenging the financial industry because it is politically difficult, and that he hopes the Group of 20 leaders will cajole the U.S. into tougher action

Economic historian Niall Ferguson asks:
Guess which institutions are among the biggest lobbyists and campaign-finance contributors? Surprise! None other than the TBTFs [too big to fails].

Manhattan Institute senior fellow Nicole Gelinas agrees:
The too-big-to-fail financial industry has been good to elected officials and former elected officials of both parties over its 25-year life span

Investment analyst and financial writer Yves Smith says:
Major financial players [have gained] control over the all-important over-the-counter debt markets…
It is pretty hard to regulate someone who has a knife at your throat.

William K. Black says:
There has been no honest examination of the crisis because it would embarrass C.E.O.s and politicians . . .
Instead, the Treasury and the Fed are urging us not to examine the crisis and to believe that all will soon be well. There have been no prosecutions of the chief executives of the large nonprime lenders that would expose the “epidemic” of fraudulent mortgage lending that drove the crisis. There has been no accountability…

The Obama administration and Fed Chairman Ben Bernanke have refused to investigate the nature and causes of the crisis. And the administration selected Timothy Geithner, who with then Treasury Secretary Paulson bungled the bailout of A.I.G. and other favored “too big to fail” institutions, to head up Treasury.

Now Lawrence Summers, head of the White House National Economic Council, and Mr. Geithner argue that no fundamental change in finance is needed. They want to recreate a secondary market in the subprime mortgages that caused trillions of dollars of losses.

Traditional neo-classical economic theory, particularly “modern finance theory,” has been proven false but economists have failed to replace it. No fundamental reform can be passed when the proponents are pretending that there really is no crisis or need for change.

Harvard professor of government Jeffry A. Frieden says:
Regulatory agencies are often sympathetic to the industries they regulate. This pattern is so well known among scholars that it has a name: “regulatory capture.” This effect can be due to the political influence of the industry on its regulators; or to the fact that the regulators spend so much time with their charges that they come to accept their world view; or to the prospect of lucrative private-sector jobs when regulators retire or resign.

[Arraya]

http://www.washingtonsblog.com/

So what is the real reason that the TBTFs aren’t being broken up?

Certainly, there is regulatory capture, cowardice and corruption:

Joseph Stiglitz (the Nobel prize winning economist) said recently that the U.S. government is wary of challenging the financial industry because it is politically difficult, and that he hopes the Group of 20 leaders will cajole the U.S. into tougher action

Economic historian Niall Ferguson asks:
Guess which institutions are among the biggest lobbyists and campaign-finance contributors? Surprise! None other than the TBTFs [too big to fails].

Manhattan Institute senior fellow Nicole Gelinas agrees:
The too-big-to-fail financial industry has been good to elected officials and former elected officials of both parties over its 25-year life span

Investment analyst and financial writer Yves Smith says:
Major financial players [have gained] control over the all-important over-the-counter debt markets…
It is pretty hard to regulate someone who has a knife at your throat.

William K. Black says:
There has been no honest examination of the crisis because it would embarrass C.E.O.s and politicians . . .
Instead, the Treasury and the Fed are urging us not to examine the crisis and to believe that all will soon be well. There have been no prosecutions of the chief executives of the large nonprime lenders that would expose the “epidemic” of fraudulent mortgage lending that drove the crisis. There has been no accountability…

The Obama administration and Fed Chairman Ben Bernanke have refused to investigate the nature and causes of the crisis. And the administration selected Timothy Geithner, who with then Treasury Secretary Paulson bungled the bailout of A.I.G. and other favored “too big to fail” institutions, to head up Treasury.

Now Lawrence Summers, head of the White House National Economic Council, and Mr. Geithner argue that no fundamental change in finance is needed. They want to recreate a secondary market in the subprime mortgages that caused trillions of dollars of losses.

Traditional neo-classical economic theory, particularly “modern finance theory,” has been proven false but economists have failed to replace it. No fundamental reform can be passed when the proponents are pretending that there really is no crisis or need for change.

Harvard professor of government Jeffry A. Frieden says:
Regulatory agencies are often sympathetic to the industries they regulate. This pattern is so well known among scholars that it has a name: “regulatory capture.” This effect can be due to the political influence of the industry on its regulators; or to the fact that the regulators spend so much time with their charges that they come to accept their world view; or to the prospect of lucrative private-sector jobs when regulators retire or resign.

[Arraya]

http://www.washingtonsblog.com/

So what is the real reason that the TBTFs aren’t being broken up?

Certainly, there is regulatory capture, cowardice and corruption:

Joseph Stiglitz (the Nobel prize winning economist) said recently that the U.S. government is wary of challenging the financial industry because it is politically difficult, and that he hopes the Group of 20 leaders will cajole the U.S. into tougher action

Economic historian Niall Ferguson asks:
Guess which institutions are among the biggest lobbyists and campaign-finance contributors? Surprise! None other than the TBTFs [too big to fails].

Manhattan Institute senior fellow Nicole Gelinas agrees:
The too-big-to-fail financial industry has been good to elected officials and former elected officials of both parties over its 25-year life span

Investment analyst and financial writer Yves Smith says:
Major financial players [have gained] control over the all-important over-the-counter debt markets…
It is pretty hard to regulate someone who has a knife at your throat.

William K. Black says:
There has been no honest examination of the crisis because it would embarrass C.E.O.s and politicians . . .
Instead, the Treasury and the Fed are urging us not to examine the crisis and to believe that all will soon be well. There have been no prosecutions of the chief executives of the large nonprime lenders that would expose the “epidemic” of fraudulent mortgage lending that drove the crisis. There has been no accountability…

The Obama administration and Fed Chairman Ben Bernanke have refused to investigate the nature and causes of the crisis. And the administration selected Timothy Geithner, who with then Treasury Secretary Paulson bungled the bailout of A.I.G. and other favored “too big to fail” institutions, to head up Treasury.

Now Lawrence Summers, head of the White House National Economic Council, and Mr. Geithner argue that no fundamental change in finance is needed. They want to recreate a secondary market in the subprime mortgages that caused trillions of dollars of losses.

Traditional neo-classical economic theory, particularly “modern finance theory,” has been proven false but economists have failed to replace it. No fundamental reform can be passed when the proponents are pretending that there really is no crisis or need for change.

Harvard professor of government Jeffry A. Frieden says:
Regulatory agencies are often sympathetic to the industries they regulate. This pattern is so well known among scholars that it has a name: “regulatory capture.” This effect can be due to the political influence of the industry on its regulators; or to the fact that the regulators spend so much time with their charges that they come to accept their world view; or to the prospect of lucrative private-sector jobs when regulators retire or resign.

[Arraya]

http://www.washingtonsblog.com/

So what is the real reason that the TBTFs aren’t being broken up?

Certainly, there is regulatory capture, cowardice and corruption:

Joseph Stiglitz (the Nobel prize winning economist) said recently that the U.S. government is wary of challenging the financial industry because it is politically difficult, and that he hopes the Group of 20 leaders will cajole the U.S. into tougher action

Economic historian Niall Ferguson asks:
Guess which institutions are among the biggest lobbyists and campaign-finance contributors? Surprise! None other than the TBTFs [too big to fails].

Manhattan Institute senior fellow Nicole Gelinas agrees:
The too-big-to-fail financial industry has been good to elected officials and former elected officials of both parties over its 25-year life span

Investment analyst and financial writer Yves Smith says:
Major financial players [have gained] control over the all-important over-the-counter debt markets…
It is pretty hard to regulate someone who has a knife at your throat.

William K. Black says:
There has been no honest examination of the crisis because it would embarrass C.E.O.s and politicians . . .
Instead, the Treasury and the Fed are urging us not to examine the crisis and to believe that all will soon be well. There have been no prosecutions of the chief executives of the large nonprime lenders that would expose the “epidemic” of fraudulent mortgage lending that drove the crisis. There has been no accountability…

The Obama administration and Fed Chairman Ben Bernanke have refused to investigate the nature and causes of the crisis. And the administration selected Timothy Geithner, who with then Treasury Secretary Paulson bungled the bailout of A.I.G. and other favored “too big to fail” institutions, to head up Treasury.

Now Lawrence Summers, head of the White House National Economic Council, and Mr. Geithner argue that no fundamental change in finance is needed. They want to recreate a secondary market in the subprime mortgages that caused trillions of dollars of losses.

Traditional neo-classical economic theory, particularly “modern finance theory,” has been proven false but economists have failed to replace it. No fundamental reform can be passed when the proponents are pretending that there really is no crisis or need for change.

Harvard professor of government Jeffry A. Frieden says:
Regulatory agencies are often sympathetic to the industries they regulate. This pattern is so well known among scholars that it has a name: “regulatory capture.” This effect can be due to the political influence of the industry on its regulators; or to the fact that the regulators spend so much time with their charges that they come to accept their world view; or to the prospect of lucrative private-sector jobs when regulators retire or resign.

[Arraya]

http://www.washingtonsblog.com/

So what is the real reason that the TBTFs aren’t being broken up?

Certainly, there is regulatory capture, cowardice and corruption:

Joseph Stiglitz (the Nobel prize winning economist) said recently that the U.S. government is wary of challenging the financial industry because it is politically difficult, and that he hopes the Group of 20 leaders will cajole the U.S. into tougher action

Economic historian Niall Ferguson asks:
Guess which institutions are among the biggest lobbyists and campaign-finance contributors? Surprise! None other than the TBTFs [too big to fails].

Manhattan Institute senior fellow Nicole Gelinas agrees:
The too-big-to-fail financial industry has been good to elected officials and former elected officials of both parties over its 25-year life span

Investment analyst and financial writer Yves Smith says:
Major financial players [have gained] control over the all-important over-the-counter debt markets…
It is pretty hard to regulate someone who has a knife at your throat.

William K. Black says:
There has been no honest examination of the crisis because it would embarrass C.E.O.s and politicians . . .
Instead, the Treasury and the Fed are urging us not to examine the crisis and to believe that all will soon be well. There have been no prosecutions of the chief executives of the large nonprime lenders that would expose the “epidemic” of fraudulent mortgage lending that drove the crisis. There has been no accountability…

The Obama administration and Fed Chairman Ben Bernanke have refused to investigate the nature and causes of the crisis. And the administration selected Timothy Geithner, who with then Treasury Secretary Paulson bungled the bailout of A.I.G. and other favored “too big to fail” institutions, to head up Treasury.

Now Lawrence Summers, head of the White House National Economic Council, and Mr. Geithner argue that no fundamental change in finance is needed. They want to recreate a secondary market in the subprime mortgages that caused trillions of dollars of losses.

Traditional neo-classical economic theory, particularly “modern finance theory,” has been proven false but economists have failed to replace it. No fundamental reform can be passed when the proponents are pretending that there really is no crisis or need for change.

Harvard professor of government Jeffry A. Frieden says:
Regulatory agencies are often sympathetic to the industries they regulate. This pattern is so well known among scholars that it has a name: “regulatory capture.” This effect can be due to the political influence of the industry on its regulators; or to the fact that the regulators spend so much time with their charges that they come to accept their world view; or to the prospect of lucrative private-sector jobs when regulators retire or resign.

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